The spread between isomer-grade mixed xylenes and key petrochemical feedstock naphtha has shrunk to a two-month low of $154/mt Wednesday amid an added supply of isomer-MX coupled with low demand from China, market sources said.
Isomer-MX was last assessed at $737/mt FOB Korea and naphtha at $583/mt CFR Japan Wednesday.
The MX-naphtha spread hit a year-to-date high of $234.75/mt on February 13, amid healthy spot demand from China and plant turnarounds at northeast Asian MX producers.
Both the price and margins for isomer-MX have decreased since February as at least one South Korean paraxylene producer was heard selling its feedstock isomer-MX to the market over April and May due to shutdown at its paraxylene plant for maintenance.
One of the buyers said the total volume offered by the PX producer was close to 100,000 mt over April and May.
Meanwhile, spot demand from Chinese buyers has shrunk after the Lunar New Year holidays as China's partial rollout of a more stringent tax reporting regime for oil products in March lowered demand for petrochemical gasoline blendstocks such as isomer-MX and solvent-grade mixed xylene, market sources in China said.
Prompt domestic price of isomer-MX in east China was last heard at Yuan 5,520-5,530/mt on Wednesday, or about $717/mt on an import parity basis.
The isomer-MX price hit a year-to-date high of $801/mt FOB Korea on February 27, but has since fallen 8%.
However, margins for PX-producers have, at the same time, improved as the PX-MX spread on Thursday hit $214/mt, up from a year-to-date low of $174.67/mt on February 13.
